Lord King of Bridgwater: My Lords, I join the noble Lord, Lord Peston, in paying tribute to the committee. I have not served on another Select Committee for a long time, if ever—I cannot remember if I have been on one before—but serving on this one has been a most impressive experience. I pay tribute to my noble friend Lord Fowler for the way in which he chaired the committee and for the extremely well written report—his previous experience may have played its part—which was extremely well spoken to in this debate. It has given the attention to this issue that the importance of the BBC deserves. I join all noble Lords who have spoken in recognising that in the BBC we have a most precious national asset.
	The Government, who at the moment exercise total power over this matter, have a very heavy responsibility to make sure that they do not take any steps that might damage the significance, importance and value of the BBC to our country and, as the noble Lord, Lord Judd, said, to the world. When the committee visited Germany, we asked for critical comments about the BBC. The Germans always started by apologising and saying, "You must remember, they set us up". Public broadcasting in Germany recognises very clearly, and is conscious of the debt that it owes to, the traditions and quality of the BBC, which it admires very much.
	Of course, our purpose is not simply to be cheerleaders. We have a duty to scrutinise. It would take too much time to repeat what my noble friend Lord Fowler said. The BBC cannot be above criticism; it must accept fair scrutiny; it must respect the fact that criticism comes from friends and admirers who want to see success continue; and it must not simply believe that it will always continue without criticism. The licence fee involves a difficult judgment. With the increasing number of channels and choice that exists in broadcasting, there are bound to be questions as to why people who never watch the BBC should be required to pay that fee. Yet, as the noble Lord, Lord Peston, said, it is an invention of genius. I think that there is universal recognition that there is no effective alternative and that the licence fee should stay.
	But at what level should the fee be set? We are allowed to anticipate, even if the evidence has not been published. The Times has published the comment made by Mr Charles Allen, the ITV chief executive, who said:
	"If the BBC got anywhere near the increase they are asking for, it would be ridiculous".
	I shall not enter into the judgment on that. The answer has to be independent scrutiny, so that the BBC has a validation for requests of that kind. It should not be considered a threat. I was chairman of the oversight committee of the intelligence services, which had exactly the same thought: "We can't possibly have these people overseeing us". Ultimately, MI5, MI6 and GCHQ began to appreciate that outside validation and oversight is a strength and not a threat when it is approached in the right way and you have confidence in the representations that you make. When the BBC faces major challenges and major calls and demands on its finance, outside validation is essential.
	If I have a criticism of the committee's work so far, it is that in certain respects we were technologically challenged. We were undoubtedly helped by the presence of the noble Lord, Lord Maxton, who reminded us of the amazing developments that are around—a number of which some of us had never heard of. There is no question that we realised that we face a sea of new opportunities and challenges of quite extraordinary dimensions and that an explosion of variety now exists. My noble friend Lord Fowler referred to our great experience. Many of us, but not all, are of the older generation who are challenged by a number of these developments.
	We established, particularly from the evidence that we took in Bristol, that there are real uncertainties about the changeover from analogue to digital. There is a lot of discussion about "averages"—what the average coverage will be; what the average is that exists under analogue; and what the average will be under digital. But within those averages is an enormous number of people in different places, many of whom are elderly and vulnerable, who may find real difficulties, may feel completely lost and fear that they may lose a very valuable source of communication. For all the surge of broadband that seems to be moving forward, there are real problems coming.
	On one issue there was fundamental disagreement and, most disappointingly, I do not agree with what my noble friend Lord Fowler said in his speech, although I know why he said it and he may be right; namely, that the decision is taken on the governance of the BBC. This cross-party, cross-experience committee—everybody—thinks that the Government are going the wrong way and are not being sufficiently careful to protect the prospects of the BBC or to recognise the strength of the BBC, which could be a very damaging decision. The reality is that we have found no one who agrees with the Government, except for people in the Government.
	I re-read the evidence of Michael Grade, the newly appointed BBC chairman; he said that it was,
	"not the route we would have chosen . . . I think we can make it work".
	I missed this at the time, but I have just re-read that he also said:
	"There are lots of people with theories on how the BBC should be run, quite often from people who have never actually run anything".
	I noted down, "quote DCMS". When one looks at how these things originate, who produces them? Conscientious officials, many of whom have never run anything in their lives, put forward a proposal, get the rolling power of the Government behind it with their majority votes and persuade busy Ministers who are occupied with other things and may not have been closely involved on the subject before. Suddenly we find that that is what we have got.
	I think that Charles I would have been proud of Secretary of State Tessa Jowell's staunch proposal to keep Parliament out of it—stick to the divine right of Kings or Secretaries of State. The idea that it is Queen in Council and Privy Council is an outrageous proposition. Our definition in the report is not quite right. It gives the impression that Privy Council is a pretty active body. It states that,
	"only Ministers of the democratically elected Government of the day participate in its policy work".
	I did not know that the Privy Council had any policy work. It continues:
	"Its day to day business is transacted by those of Her Majesty's Ministers".
	What is the day-to-day business of the Privy Council? It meets once a month standing in front of the Queen, nodding properly. I do not think that I am breaking the oath of a Privy Counsellor in disclosing the terrible secrets of the Privy Council. It is a perfect cover for a government to do exactly what they like, which is why we are having this debate. There will be no other parliamentary process. This is our only opportunity to get this point across. There is sad evidence, including Sir Christopher Bland saying that delivery was what the Government were doing, but that the battle is lost. Even my revered chairman has said that he thinks that the decision is taken. I hope that we can still fight this issue. There is not a single person—neither of the past two chairmen of the BBC—who believes that. The reality is that this proposition emerged at the worst possible time. It emerged in the chaos that existed during the worst spat between the Government and the BBC. Something had to be done and "here comes a proposition".
	I do not want to be misunderstood, and there is no criticism of the individual concerned, but it concerns me as a former member of the Nolan committee, and I wonder whether I am the only person who is worried that officials move from the DCMS, which put forward the proposals, into jobs in the new structure at the BBC. There is an issue of integrity of government here and I say to Ministers very seriously that it needs to be looked at very clearly.
	We are going forward with a structure that no one from whom we took evidence believed to be the best—the current BBC chairman said that it was not the one that he would have chosen—and that those who have brought any outside experience of trying to run another organisation do not believe will work. We are going to have two chairmen of the BBC, so who will identify who is really responsible? There will be a supervisory board, but it will be part regulator, part supervisor and a real muddle. I hope that that awful pistachio ripple will be promptly melted down and that we will get back to a clear structure of governance and respect. I hope that this national asset that we all value so much is not played on some temporary new management arrangement that could be absolutely disastrous. I warn the Government very clearly that we will watch this very carefully. If they do not change the plan and it goes forward like this, on their own heads be it. It is a recipe for conflict and for real trouble in the future.